WASHINGTON – U.S. Transportation Secretary Anthony Foxx announced on July 26, 2015, that Fiat Chrysler Automobiles has acknowledged violations of the Motor Vehicle Safety Act’s requirements to repair vehicles with safety defects and will submit to rigorous federal oversight, buy back some defective vehicles from owners, and agreed to a $105 million civil penalty, the largest ever imposed by the Department’s National Highway Traffic Safety Administration (NHTSA).
The enforcement action comes after a July 2 public hearing at which NHTSA officials outlined problems with Fiat Chrysler’s execution of 23 vehicle safety recalls covering more than 11 million defective vehicles. Fiat Chrysler has since admitted to violating the Safety Act in three areas: effective and timely recall remedies, notification to vehicle owners and dealers and notifications to NHTSA.
In a consent order issued by NHTSA, Fiat Chrysler commits to take action to get defective vehicles off the roads or repaired, including the 1993–1998 Jeep Grand Cherokee, 2009 Chrysler Aspen, and 2009–2012 Dodge Ram 1500, among others. For a complete list and instructions go to: Chrysler FAQs. Owners of more than half a million vehicles with defective suspension parts that could cause the vehicle to lose control will have the opportunity to sell their vehicle back to Fiat Chrysler. Owners of more than a million Jeeps that are prone to deadly fires either will have the chance to trade their vehicle in for above its market value, or will receive a financial incentive to get their vehicle remedied.
The consent order requires FCA to notify vehicle owners eligible for buybacks and other financial incentives that these new options are available.
The automaker also agrees to unprecedented oversight for the next three years, which includes hiring an independent monitor approved by NHTSA to assess, track and report the company’s recall performance.
The company must pay a $70 million cash penalty–equal to the record $70 million civil penalty the agency imposed on Honda in January. In addition, Fiat Chrysler must spend at least $20 million on meeting performance requirements included in the Consent Order. Another $15 million could come due if the independent monitor discovers additional violations of the Safety Act or the Consent Order.